UK Coal has been split into two separate mining and property businesses, with the mining business continuing as the employer sponsor of the Mineworkers Pension Scheme and Coal Staff Superannuation Scheme, and the two schemes now owning 75.1 per cent of the new property business.

The company announced details of the restructuring plan in August, and today it has confirmed the split into Mine Holdings and Harworth Estates. In return for giving up any potential claim against the property business, the pension funds have a 75.1 per cent stake in Harworth Estates, which has 30,000 acres of land and other property. The schemes have injected £30m into the firm so that it has the necessary funds to develop the properties and thus achieve the maximum value for the pension funds in the long term.

Apart from helping to safeguard 2,500 jobs, the restructuring has also created a funding plan for the company’s £450m pension deficit, the company's chairman Jonson Cox said.

Aon Hewitt, which has advised the pension schemes on the deal, said the restructuring has helped to protect the benefits of the schemes’ 6,800 members.

Aon Hewitt partner and actuary to the pension schemes Donald Duval said: “The split of the business, with the pension schemes taking the majority share in the property business, is an innovative solution to the problem of funding the pension schemes while allowing the companies to invest in the business.

"This is an excellent outcome for the business, the trustees and the members – particularly as the alternative might well have been the schemes entering the Pension Protection Fund, which would have meant much-reduced benefits for the members."

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